Public hearing: Coordinated service delivery Input by Department of Water Affairs 03 February 2010

Outline of Presentation Department’s deliverables Department’s view of the challenges and the current system of service delivery What interventions the department has in place to improve the current situation 2

Constitutional context The Constitution addresses the rights of individuals to access basic water and sanitation and it sets out the institutional framework for services provision It gives municipalities executive authority and the right to administer the provision of water services within their areas of jurisdiction National and provincial government have the authority to regulate the effective performance of local government in terms of water services. National and provincial government also have an obligation to support and strengthen the capacity of local government to provide services . 3

DWA’s Mandate DWA’s: key role is provide leadership within the Water Sector:- national regulator of the water sector develop national policy, norms and standards, guidelines Provide targeted support to municipalities , where necessary, in line with its regulatory function to ensure Compliance with minimum national norms and standards. Good performance and efficient use of resources. Good contracting practice IV) Information management Municipalities: that are designated as Water services Authorities have a constitutional mandate and responsibility for water and sanitation delivery Planning Local regulation of water services Water Services Provision 4

Support Support to LG entails the provision of technical advice and hands-on support to municipalities to undertake their roles as Water Services Authorities and to comply to set norms and standards on water service delivery projects. Support is therefore aimed at ensuring that municipalities have the capacity to manage their own affairs, to exercise their powers and to perform their functions by means of legislative and other measures 5

Deliverables (1) Support to ALL Water Service Authorities (WSAs) includes: Communication and information dissemination to promote understanding of policy; legislation; guidelines and tools Annual reviews of the Water Services Development Plan (WSDP) (key municipal planning tool) as part of the IDP review process Electronic Water Quality Management Systems installed in all water services authorities to enable monitoring and reporting on drinking water quality and is presently extended to enable reporting on effluent quality. 6

Deliverables (2) Support to ALL Water Service Authorities (WSAs) includes: Information sessions to empower all WSA on the Regulations Performance Measurement System (RPMS) Support in understanding the requirements needed to obtain Blue Drop and Green Drop Certification Development of Risk Ratio Matrix which identifies and priorities Waste Water Treatment Works which will lead to enforcement actions where necessary Provincial water indabas led by the Minister to take place in all Provinces to enable the consultation and development of provincial Water for Growth and Development plans and with annual reviews to monitor progress DWA has initiated the review of the Water Services Act to strengthen its regulatory role. Review of Section 9 and 10 regulations to strengthen regulation of access to basic services and tariffs 7

DELIVERABLES (3) Targeted support to selected municipalities includes: Water Reconciliation Studies have been completed for major economic centres and the 26 priority growth nodes As part of enforcement protocol, DWA is working with 10 WSAs in improving their compliance through dedicated action plans that are monitored 30 WSAs supported to develop Water Conservation and Demand Management plans Hands on support to 57 municipalities on the population of the Regulations Performance Measurement System (RPMS) and informs the type of interventions required to enable municipalities to effectively perform their function As part of enforcement protocol, DWA is working with 10 WSAs in improving their compliance through dedicated action plans that are monitored 6 WSAs in Berg River Catchment Madibeng OR Tambo Mfuleni Mogale City 8

Risk Rating of Water Services Provision Across 7 risk-areas - Under Administration / wastewater treatment capacity / Blue Drop and Green Drop results / regulatory Directives, Technical Skills / Lack of Process Controllers ) 9% of munics are in severe crisis – contamination, disease 38% could become ‘crisis’ within 8 months A further 42% at risk (DWA, Oct 2009) Functional water services At risk High risk – potential to become within 8 months Crisis. Acute risk of disease outbreaks 9

DELIVERABLES (4) Targeted support to selected municipalities includes: Regional Bulk Infrastructure Programme Grant mechanism established to supplement the financing for the development of regional bulk water infrastructure and regional bulk sanitation collection as well as regional water and waste water treatment works and supports the provision of sustainable water and sanitation services by municipalities. The 2010 MTEF allocation is R3,86 billion of which R611 m is available for 2009/10 102 projects are in various stages of implementation since 2007/08 Accelerated Community Infrastructure Programme (R240m in 2009/10) Rapid intervention programme to accelerate the achievement of universal access to water and sanitation services by 2014 with a focus on 3 areas Community infrastructure projects for water (13) and sanitation (14) projects are implemented and is rural biased Water conservation and demand management projects are implemented in four Metros (Jhb, City of CT, eThekwini, Nelson Mandela Bay Waste water infrastructure and refurbishment projects are ongoing in 20 municipalities across 10

CHALLENGES: Access to water (1) Huge financing gap in Bulk infrastructure programme to deliver water to where it is needed and to improve the safety of treated drinking water Informal Settlements: responsibility for upgrading lies with Human Settlements and service upgrading is part of broader settlement upgrading. Insufficient land to address upgrading Planning and programme management skills 11

Water Service Challenges (spatially presented) WATER AVAILABILITY CHALLENGE Extensive water backlogs (villages) Water stressed areas Local WR limitations Water quality challenges Water demand management need Requires WR development (De Hoop & others) Requires major regional bulk infra High capital and O&M cost Major funding needs GROUNDWATER & WATER QUALITY CHALLENGE Scattered rural settlements (high poverty) Low local economic development potential Groundwater dependent (with water quality risks) Limited surface water development potential Water reticulation needs (with O&M challenges) WATER DISTRIBUTION CHALLENGE Extensive water backlogs (scattered) Within water-rich WMA (but no access) Requires WR developments Requires major regional bulk infra High capital and O&M cost (topography) Major funding needs CONTEXT of CHALLENGE water availability and accessibility topographic and physical challenges impacting on capital and operating costs bulk infrastructure dependency with associated funding and implementation time frames total life-cycle management with associated skills and sustainable management phased approach providing for interim solutions while addressing longer-term sustainable development 12 12

Challenges: Access to Improved Sanitation Inadequate management of sanitation infrastructure (from VIPs to waste water treatment works) Resulting in technical breakdowns and declining service delivery performance Increased demand for water sanitation vs. the available water in catchment 13

Policy and Institutional Challenges Policy challenges – especially consistency in defining indigent households and targeting (poor vs. all) Communication and co-operation between users, councillors, local government officials and different spheres of government; Some municipalities are not viable in their current form to fulfil their service delivery mandates 14

Challenges: Finance (1) Planning and Management throughout the projects delivery chain is weak Municipal revenue management is weak and declining in many areas The more new infrastructure is built, the greater the financial and operating burden for municipalities Most tariffs are not cost-reflective and are unable to balance affordability with long-term sustainability Growing gap between expenditure and income for water services Equitable share not being used to fund provision of free basic services and O&M 15

Challenges: Finance (2) Many munics balance their books by under spending on maintenance leading to asset stripping and deteriorating infrastructure Growing treatment failures lead to disease outbreaks Rising levels of Non-Revenue Water (NRW) which is water provided without payment because of physical and commercial losses leads to huge revenue loss, depriving munics of funds they need to provide good services at least 1/3rd of water supplied to munics is lost before it reaches users 16

Challenges: Skills Most municipalities have not taken on additional staff with the competencies required to meet their expanded service delivery responsibilities Net loss of technical skills for municipalities Worsening shortage of operating and managerial skills needed to run water services, especially water services managers Engineers, technicians and technologists to design, develop and upgrade systems in short-supply Artisans, turners, fitters and instrumentation technicians critical for putting in infrastructure and maintaining and repairing it 17

Interventions: Regulation Stronger emphasis on enforcing compliance through set of protocols Better reporting systems in place that feed into Regulatory Performance Measurement System (RPMS) Training sessions and capacity building being done with Water Services Authorities on RPMS 18

Interventions: Skills Development Coherent skills strategy being developed with water sector to address capacity challenges Assist priority municipalities to access SETA funds to build the capacity of process controllers (water and waste water) Professionalisation of water services (following example of introducing defined qualification levels for municipal finance managers) Skills: Working in collaboration with DBSA on Artisan programme to address skills shortages Collaborate with CoGTA and SALGA on councilor skills development plan. 19

Going Forward (1) Strengthening WCDM support and interventions Water allocation reform and eradication of licensing backlog with specific focus to HDIs Strengthen Compliance and Enforcement and finalisation of at least 60% of non-compliance cases Professionalisation of water services (following example of introducing defined qualification levels for municipal finance managers) Enforcement of Reg 2834 for process controllers Ensuring Refurbishment of transferred schemes Going implementation of Regional bulk and ACIP programme with a rural development bias coupled with decent employment creation Job Creation as per EPWP (WfW programme) Bring in support of Water Boards where they have the reticulation capacity and expertise to address water services provision challenges Discussions in place with the National Treasury to establish a grant for refurbishment to address the sector’s needs 20

Going forward (2) Need to drive a comprehensive review of water costs and pricing across the value chain Discussions on the formation of an Independent regulator. Cooperation between Departments to address access to water services must be strengthened Active engagement with the CoGTA local government turn around strategy DWA in the process of developing a business case to reflect the massive funding needed to repair/refurbish/renew decaying infrastructure in selected areas and negotiations with National Treasury have been initiated 21

Areas of concern that cannot be funded Meeting the targets for infrastructure delivery programmes both bulk and portable water O&M and refurbishment of existing infrastructure Dedicated funding to provide Technical expertise (resource pool) to provide extensive specialist support WSAs to address non-compliance and service delivery 22

Thank you